Our constitution and laws form our social contract. These
are enforced by the government, on the grounds that it is the ultimate owner of
all the nation's territory. The decision to live on its territory constitutes
the agreement to abide by its social contract, much like boarding
a train constitutes an agreement to pay the conductor when he
comes around to collect. Those who refuse to abide by the social
contract must not reside on its territory; they should avail themselves
to the market of nations, which offers nearly 200 selections.
Libertarians who object that they shouldn't have to move (for
a number of reasons) are inconsistent, because their proposed
society would recreate the market of nations on a smaller scale.
That is, they would create a market of sovereign property owners,
and would expect dissatisfied customers, renters and workers to
simply go elsewhere on the market.

The nation's constitution and laws comprise our social contract.
In this contract, voters have agreed to exchange their money for
the government's goods and services, and to abide by laws passed
by their democratically elected legislators. Like any contract,
refusal by either party to live up to its end of the deal is considered
breach of contract, and justifies the appropriate law enforcement
measures.

Most of the objections to the idea of a social contract stem from
libertarians. They object that there cannot be a social contract
because the government doesn't own anything to contract about.
But, as argued in the previous section, the government is the
ultimate owner of society's territory, because it is vested with
the force (military, police) and control (legislative, judicial)
to defend and maintain our system of property. Therefore, our
social contract is an agreement between the owner of property
(society, as represented by government) and a constituent who
wants to make use of that property.

The decision to reside on U.S. territory is the fundamental agreement
to abide by its social contract. If people refuse to accept this
contract, then they must not reside. The situation is akin to
owning a condominium. The condominium is yours, but it comes with
a contract between you and the condominium association. In it,
you agree to pay fees in exchange for specified services and to
abide by the rules of the association. Of course, you have an
equal vote with the other condominium owners concerning the budget
and rules. However, if you have no intention of abiding by these
rules, then you have no right to reside. Indeed, if the rules
strike you as tyrannical, then you should move. There are many
other places to live in the housing market.

Libertarians object that they should not have to move to another
country if they wish not to abide by the social contract. Admittedly,
this is a rather drastic and unappealing option; most
people would be dismayed by a system that does not allow its members
to solve their problems in place, but simply tells them to move elsewhere.
Hold onto this dismay for a moment; we will show how libertarianism
produces the same problem, only worse.

The libertarian objection to the social contract is inconsistent
with their philosophy for two reasons.
The first is that this is not an argument they would support concerning
any other type of contract -- indeed, libertarians are spirited
defenders of contracts in all other cases. The only difference
between the contract of a condominium complex and that of a nation
is the number of residents and level of complexity. Why, then,
should one be honored, the other dishonored?

The second inconsistency is with their faith in markets. There
is a market of nearly 200 nations to choose from, which is a very
rich choice indeed, especially compared to domestic markets. (Can
you name a brand of soup other than Campbell's or Lipton's?) Most
people would have no trouble recognizing that the millions of
foreigners trying to immigrate to the U.S. are the equivalent
of customers making a selection on the market of social contracts.
The same opportunities exist for libertarians. If they object to
this market of contracts for any reason, then they must explain
why recreating the same system on a smaller scale would prove any
better.

Put another way, the objection to moving is inconsistent with
the libertarian goal of awarding individuals sovereign rights to
their property, since that would essentially recreate the market
of nations on a smaller scale in our society. That is, landlords
and business owners would become the rulers of their own pocket
principalities, and renters and workers who disliked their conditions
would simply be advised to look elsewhere on the market for jobs
and apartments. Libertarians balk at the same principle on a larger
scale, but they can't support a market of sovereign property owners
only in those cases where it suits them.

Libertarians also object that there is no libertarian country
to emigrate to. But if libertarians cannot find exactly what they
want on the market of nations, that's because no one realistically
expects a market to supply customers with exactly what they want
-- just as no market produces cars which let you travel at the
speed of sound and get 2,000 miles per gallon. And although libertarians
may not find their desired nation, they would in fact find many
nations with greater libertarian features than the U.S. Many Third
World countries, for example, have far smaller tax rates and public
sectors than ours. Most are less burdened with business regulations. Chile,
for example, underwent 17 years of radical free-market reform under the guidance
of the University of Chicago, and reduced its government as much as was
humanly possible. (The result was South America's worst income inequality and
pollution problems.)
Some, like Somalia, even practice pure anarchy and Social Darwinism.

Of course, few people would want to live in these places. The
flow of international emigration is from low-tax Third World countries
to high-tax First World countries, not vice versa. And there is
a reason, at least among democratic countries, why the richest
and most appealing nations have the highest taxes. Liberals argue
that prosperity results when the people commission their governments
to look after the common interest; this comes in the form of economic
infrastructure (like highways), public goods (like national defense)
and law and order (not just against street crime, but business
crime as well). Libertarians want a free lunch; they want the
prosperity of America combined with the low taxes and regulation
of Angola. However, this combination doesn't exist for a reason.

In fact, the "market of nations" is one that libertarians
would applaud in any other circumstance. It is an anarchic international
system with no super-government controlling emigration. And this
market has been exposed to the concept of individual freedom for
over 200 years. The complete lack of purely libertarian nations
is therefore a problem for them. One could say that the winners
in this free market are those nations which receive the most immigrants.
Why, then, does immigration generally flow from the low-tax Third
World to the high-tax First World? (To say that they are attracted
to the handouts of the welfare state is to miss the point; why
are welfare states generally richer than non-welfare states in
the first place?) And why have governments almost universally
grown larger, not smaller, over the last 200 years?

Libertarians can try in four different ways to explain why the
market of nations has not produced their desired society:

They can deny that there is a market of nations, in the face
of obvious evidence that there is one.

They can claim it is not really a free market because force
is involved. That is true: places like Cuba do not allow their
citizens to emigrate. But then they cannot explain how the finer
granularity they propose for their own system will stably solve
this problem. At an ultimate level, the force must be there to
determine ownership.

They can try to explain the lack as a market failure, but
this conflicts with their rhetoric about market failures being
due to interference within state controlled markets.

If they ignore that rhetoric, and demand some sort of regulation
to produce the results they want, we then get to chide them for
impractical inconsistency, and ask why we shouldn't regulate other
markets as well.

The implicit nature of the contract

Some libertarians protest that they have never signed the
contract. But our society has long recognized the validity of
implied contracts. For instance, eating dinner in a restaurant
obligates you to pay for it, even though you haven't signed anything.
Another example is boarding a train; passengers can often board
without buying a ticket beforehand, but their mere presence on
the train obligates them to buy one when the conductor comes around
to collect. The train owner gets to set the method of agreement:
he does not have to require any other proof of agreement than
the passenger's boarding.

Children are another example of the implicit nature of the contract.
Many libertarians argue that because children enter a social contract
by accident of birth, it's not fair that they should be subject
to a contract they never agreed to. But there is no accident here.
At least for the first part of your life, your parents (or legal
guardians), acting through their powers of custody, chose your
initial citizenship and residence at birth. This status is implicitly
continued through adulthood until explicitly revoked. (A few extremist
libertarians have argued that the parents' custodial powers violate
a child's rights, but this is a strange argument; who seriously
believes that children are generally better suited to provide
for their own welfare than parents?)

Children and the ongoing nature of the contract

In fact, children are one of the greatest reasons why we need
a social contract, and why it needs to be kept ongoing. Both children
and immigrants represent continually arriving newcomers to the
contract and the society it shapes. Therefore, they deserve an
equal voice in renegotiating the contract (when of age), if we
are pay anything more than lip service to the concept of equal
opportunity in our society.

Consider what the libertarians propose in its stead: 100 percent
property rights to individuals, which means that rich families
could afford to send their kids off to college, and then on to
lucrative careers; poor families would be trapped in intergenerational
poverty. This is the makings of a caste system. Libertarians claim
it is unfair that an accident of birth should condemn a person
to live under an involuntary social contract. But they see nothing
wrong with letting an accident of birth condemn a person to live
under an involuntary economic contract. The social contract, with
its periodic democratic elections, is the only system that gives
newcomers the chance to voice their agreement and help shape the
contract.

There are other reasons for a perpetual contract. Perhaps the
most important is the U.S. is the owner of its territories, and
there is no statute of limitations on either ownership or the
rules stipulated by owners for the use of their property. Another
reason why the contract needs to be kept ongoing is because law
and order and the defense of property need to be kept ongoing.

Other arguments on the social contract

Many libertarians criticize the social contract because it
doesn't resemble other contracts. However, there are many different
types of contracts, each with its own unique features, and just
because they differ doesn't mean they are not contracts. Contracts
come in many forms: written, oral and implied. Some rely on the
courts or other third parties to correct breach of contract, others
rely on their own enforcement mechanisms to primarily correct
breach of contract (such as a landlord's stipulation of a cleaning
deposit).

Some criticize the social contract because it can be unilaterally
modified by the government. But so can other types of contracts:
condominiums are a prime example. If the condominium association
creates rules you don't agree with, you can try to persuade the
other voting residents to change them. Or you can move somewhere
else. There are other examples of unilaterally modified contracts:
insurance and utility companies both can change their rates without
your permission, and the best you can do is vote with your feet.

Another objection is that the social contract doesn't treat its
members equally -- that is, it takes more from one group and gives
more to another group. But so do insurance companies.

Yet another objection is that it's unfair for one of the members
of the contract to be its enforcer. But our government is separated
into independent branches, creating a system of checks and balances
to prevent abuses of power. Citizens also have the vote, which
allows them to control how the enforcer enforces.

Finally, some object that if you have to move to change your social
contract, you are forced to dispossess yourself of your immovable
property. That's just wrong: there are any number of absentee
owners of property in the US. However, you are not being robbed
of your property: you get to exchange it for its market value.
You won't get a better deal with any rental when you have to
move.

The history of the social contract

Over the millennia, social contracts have changed, and much
for the better. Many of the early societies were run by tyrants
-- that is, monarchs who ruled slaves. Although these arrangements
provided the group with a military defense, law and order, and
a property and market system, they could not be called social
contracts. That's because a social contract is an agreement among
society, and slaves do not agree to their enslavement. However,
some monarchies were less tyrannical than others, and actually
served as a bridge to modern-day democracies. For example, many
of the British monarchs were popular and beloved by their people.
In this case, we could say that a social contract existed, because
citizens agreed to pledge their loyalty to the Crown in return
for the law and order and strength through numbers that the Crown
provided. In the last two centuries, of course, the social contract
has become even more enlightened, with the rise of democratic
participation and individual rights, which maximizes each citizen's
contribution and agreement to the contract.

This evolution can also be seen in American history. After overthrowing
the rule of the British monarchy, the thirteen American colonies
immediately replaced it with their own democratic social contract.
Eventually, the new nation began expanding westward, but it was
the federal government -- not individual frontiersmen -- that
led the expansion. For example, the federal government spent $15
million on the Louisiana Purchase, $25 million on the Texas/California
purchase, and $7 million on the Alaskan Purchase. It then turned
around and sold this land to American citizens at a considerable
loss to itself, even homesteading it for free in many cases. Other
territories it acquired by treaty and armed conquest. Incidentally,
the vast majority of the land that was conquered was conquered
by the U.S. Army -- not rifle-toting pioneers.

As a result, the federal government can demonstrate territorial
ownership of the entire United States. And that is another why
residence on its soil forms constitutes agreement to its social
contract.